Dragons outside-half Jason Tovey landed six out of six kicks with five penalties and the conversion of number eight Toby Faletau's first-half try which, along with a superb match elsewhere, added weight to his Wales RBS Six Nations squad call-up credentials.
The Blues were their own worst enemies at times as errors in the second half, during their best period of the match, meant that they failed to add a further try to the effort of hooker Kristian Dacey, which full-back Leigh Halfpenny converted. Halfpenny also added a penalty before the interval and two more after the break.
However, there were concerns for Wales national coach Warren Gatland ahead of the build-up to the Six Nations when rising star wing Hallam Amos was helped off the pitch with a leg injury.
The win takes the Dragons to sixth place in the table with their fifth win of the campaign, while the Blues have now suffered seven defeats and lay in ninth, just behind the Scarlets and the lowest ranked of the Welsh regions in the league.
There will be a chance for the Blues, who took a losing bonus point, to gain revenge on New Year's Day when the teams have a rematch at Cardiff Arms Park but this clash saw the Dragons lay down the gauntlet from the start as they caused the Blues headaches throughout.
Tovey was the centre of attention for two reasons in the early stages as he kicked the first points of the match via a 40-metre penalty and then was the victim of a possible dangerous tackle when opposite number Rhys Patchell grabbed him and turned the Dragons' half-back horizontal before laying him on the ground.
The home crowd demanded a yellow card but referee Ian Davies disagreed.
Then came a piece of magic from Faletau and his front row colleagues from a line-out on the Blues 10 metre line. Faletau stood at the scrum-half position as hooker Rhys Thomas, playing against his former region, looked to throw long.
The Blues took the bait, retreated backwards at the front of the line-out and opened a hole. Thomas fed loose-head prop Nathan Buck to pass to the Wales number eight who raced through the gap and roared over the line.
Faletau was immense as the Dragons tried to pour on the agony but finally Blues captain Sam Hobbs rallied his troops into action, paying off when a ruck on the right saw scrum-half Lloyd Williams feed the ball inside to centre Dafydd Hewitt.
A great slight of hand sent Dacey charging past the home defence and over the line for a try which Halfpenny converted.
Halfpenny landed a penalty either side of the break to put the Blues into a 13-10 lead but they lost number eight Robin Copeland to the sin-bin for 10 minutes near the hour and gave Tovey too many kickable penalties that he gratefully took and steer his side to 22-13.
Halfpenny added another penalty for a perfect four out of four kicking performance, keeping his side in sight of the win.
But a combination of stern Dragons defence and handling errors when inside the home 22 saw the Blues' efforts come to nothing.
Yet, the sell-out Bank Holiday crowd went away having witnessed a rip-roaring local derby and eager for the return next week.